An "Open Letter..."
There are many people out there who read this blog, or come to the real estate club meetings who think they "know my story".
Truthfully, most (that is those who bothered to research it, that is) know about 1/3 to 1/2 of "my story". That is the part that starts right before the events of 9/11, when I attended my very first National Real Estate investor conference in Atlanta in April of 2001, got my first deal done in June of 2001 and then had to make the grueling decision of "what do I do next" in September of 2001, when my aviation business went "tube-side".
There is another part of the story that begins well before 9/11, it is my "commercial real estate story", and it began in the Spring of 1984, when I had a chance to spend a day with a man named James W. Rouse, who directly influenced my career decision when I found out I had been admitted to graduate school (MBA Program) and decided then and there to pursue a "career" in real estate. That decision took me to Northern Virginia (by way of Stamford, CT) to become the #2 Employee at Lansdowne, VA (Xerox' multi-million dollar project on the Potomac River) and then to the Oliver Carr Co., where I had a chance to see up-close and personal how the richest people (at the time) in DC (no I wont name, names, but you can guess) became even richer by co-investing in commercial real estate in Downtown DC with someone who truly knew what he was doing (Oliver Carr and his sons). This opportunity was cut short with the severe down turn in the commercial real estate market in the late 1980's, but it ushered in my first opportunity to go from Employee ( "An E") to partner/business owner (a "B" in Robert Kiyosaki's world) and ultimately partner with one of the savviest real estate investors in the Northern Virginia/Washington, DC Region. A man named Marc Fried (FCI Companies), to whom I owe a tremendous debt of gratitude because he "bothered" to take me under his wing and share with me the wisdom it took him over 40 years to accumulate. At the time I was not ready to act on it, but the seeds had already been planted.
After stumbling around doing my own "entrepreneurial thing", including winning the rights to manage the private jet facility at Reagan/National Airport (DCA) and loosing a boatload of money on my own dot.com "bomb", in 2000, I was ready to hear what Mr. Fried and Mr. Carr and Mr. Rouse had long before attempted to teach me, which is best summed up in one sentence: "How to Get Rich In America, When No One Has Handed it To You!" And with those seeds, which were planted many years prior starting to spring to life, it was time to stop being an employee, and a consultant and a "spectator" and get into the game of real estate investing.
So, why do I know bother to share this with anyone who cares enough to read it?
True Confession Time.
I had actually planned on only sharing this information at next week's Conference, but in fairness to those who have sent me emails, or have called asking: "WHERE IS NEXT YEAR's CONFERENCE GOING TO BE - IF NOT IN BALTIMORE??"
The answer is - There is not going to be a conference next year.
At least, not one that I, or my team is responsible for putting together.
Please do not get me wrong. I love the event, and enjoy meeting with and talking to those who participate.
I also DO NOT believe the BOTTOM HAS DROPPED OUT of the real estate market and now is the time to RUSH INTO (or BACK INTO) the stock market.
FAR FROM IT.
The bottom line is that planning an event like the conference taking place next week takes a HUGE amount of resources, and patience and people. The planning started in March of this year.
At the same time, I HAVE NEVER SEEN A BETTER OPPORTUNITY FOR SERIOUS (MINDED) REAL ESTATE INVESTORS THAN NOW!
Again, if you have read my bio (http://www.WeGetThingsDone.com) you know the world I come out of with regards to my perspective on this real estate investing thing. Specifically, from 1993-1999 I watched a lot of people GET RICH BUYING INTO DISTRESSED REAL ESTATE SITUATIONS. A lot of people! From 1993-1995, we served as ASSET MANAGERS for the a Federal Agency call the RTC (Resolution Trust Corporation) - it was the Federal agency responsible for disposing of the assets from insolvent Savings and Loans. It achieved its purpose of "putting itself out of business" several years early by hiring companies like ours to "WORK OUT" bad loans. In effect, we sat across the table from the people who today are called SHORT SALE Negotiators. and during this period (1993-95) I watched people across the table from us get FILTHY STINKING RICH through their ability to negotiate us to the point that they could borrow money, even in a bad real estate market and then hold onto these positive cash-flowing properties until the markets recovered and in the process their holdings became worth 10-20 times what they acquired them for in less than 7 years. Stupid me, we then went from working for the RTC to doing the same thing (albeit on a bigger scale) with HUD, where we worked out several Billion (yes with a "B") dollars worth of loans for HUD's multifamily properties.
So, in the span of 6-7 years I watch guys like Barry Sternlich (Owner of Sheraton, Westin and "W" Hotels) buy a small portfolio of hotels with 100% borrowed money from the RTC, Joe Roberts (owner of several high profile office buildings in Downtown DC and Arlington, VA) go from Government Contractor to multi-millionaire and Gary Silversmith (owner of the Presidential Yacht Sequoa) go from government employee to real estate mogul specializing in turning around distressed "brown field" properties, as well as many others get stupid, stinking filthy rich. Something that, in my opinion, only happens when there are dramatic changes in a marketplace and those who can't hold on start dumping properties. This type of situation only happens every few years. It happened in the late 80's/early 90's, and it happened in the mid-70's and is the principal reason Donald Trump is a Billionaire today. Those who read the "Art of the Deal", or any of George Ross' books knows that Trump's very first deal was the turn-around of the financially distressed Commodore Hotel. Along with that deal he also negotiated (or more accurately, George Ross negotiated) the purchase of the PENN CENTRAL Rail yards. Today those rail yards are worth multiple billions of dollars, and of course, Trump put close to none of his own money up to acquire it.
I was not there to see how Trump did it, although I know the man who knows the whole story. But I was there to see Joe Roberts, and Gary Silversmith and Barry Sternlich take advantage of "Blips" in the marketplace, which brings me back to the purpose of this "Open Letter".
In short, I have not seen a buying opportunity for real estate investors RIGHT NOW, since the early 1990's, but this time, I AIN'T SITTING ON THE SIDELINES, OR HELPING OTHER WHILE MAKING PEANUTS!
So I come to the fork in the road:
Devote all the resources of our small enterprise for 2-3 months out of the year to coordinate and promote an event that will help others "get into the game" and hopefully make money -OR - Focus those same resources towards getting rich doing real estate for myself. What would you do...?
Don't want to appear "selfish", but the reality is that door of opportunity has now swung "wide-open" and will probably close as quickly. Please don't get me wrong, there is never a "bad time" to make money in real estate, but the opportunities to make "stupid money" like what is taking place now, tend to only come along avery 7-10 years. The last time real estate buying opportunities (particularly using OPM) looked this good, I was a "hired gun", but not ready to be a "player". Like many of you, I have children to clothe and feed and pay college tuition checks for. But I also have dreams of being a bigger player in this business and to make them come true you need a cooperating market, like the one that is shaping up right now.
I have really enjoyed being a part of this annual event and hope and pray for those who have come out in the past, that it was meaningful.
For those who are coming out next week - you have made the right choice. There has never been a better time to be in this business. The speakers and educators who are coming are coming for a reason. Bring cards, bring note pads, but most of all -"COME READY". As it was in the late 1990's, a bunch of folks are going to get the inside scoop on how to take advantage of a market in turmoil and go on to become very wealthy, while others (3-5 years from now) stand around going "What Happened??"
Sherman Ragland - Thank You For Reading...
p.s. - the end of the conference, does not mean the end of the blog. In fact, I will be sharing exactly what we do have planned for next year (and why) during my session on Day #2 - The A-Z Blueprint...
posted by ShermanDC @ 4:34 PM
0 Comments
